French bank ordered to pay damages to rogue trader

7th June 2016, Comments 0 comments

A French tribunal on Tuesday ordered Societe Generale to pay 450,000 euros in damages for firing rogue trader Jerome Kerviel -- whose actions almost bankrupted one of Europe's biggest banks.

In its judgement, the labour tribunal said Kerviel had been fired "without genuine or serious cause" and that the bank had full knowledge of his shady dealings long before he was fired in 2008.

A lawyer for Societe Generale, Arnaud Chaulet, said he would appeal the "scandalous" decision, recalling that Kerviel had been found guilty of gambling away 4.9 billion euros ($5.5 billion) of the bank's money.

Kerviel has long argued he had been made a scapegoat in the case.

His lawyer, Julien Dami Lecoz, said his client was "very happy" with the ruling.

The trader was sentenced to three years in prison in 2010, but was released in September 2014 after spending less than five months behind bars.

He was convicted of breach of trust, forgery and entering false data, but claimed his bosses turned a blind eye as long as the profits kept rolling in.

Kerviel was also initially ordered to compensate Societe Generale for the full amount of the money he lost, but an appeals court later overturned the order, arguing that the bank's internal oversight mechanisms had failed.

- 'Manipulation' -

French investigators are currently weighing his request for a retrial of the criminal case following revelations that the bank may have known more than was let on.

Kerviel has based his retrial bid on testimony given last year by Nathalie Le Roy, a top detective in the case.

She told a court behind closed doors in April 2015 that she felt Societe Generale had "manipulated" her during the investigation in 2008.

According to a transcript seen by AFP, Le Roy told the court: "I had the feeling, then the certainty, that Jerome Kerviel's superiors could not have been unaware" that he was taking wildly risky bets on equity derivatives.

In a bombshell revelation in January, Le Roy presented recordings of a former deputy prosecutor in the case, Chantal de Leiris, saying it was "obvious" that the bank was aware of Kerviel's shady dealings.

"When the subject comes up, anyone even a little bit involved in finance laughs, knowing very well that Societe Generale knew... it's obvious, obvious," says de Leiris in the recordings, made in June 2015.

Societe Generale has rejected what it called "pseudo-revelations" and "media manipulation" in the case.

It is "implausible that those directly above Jerome Kerviel or the people who worked with him every day knew but didn't say anything," another Societe Generale lawyer Jean Veil told AFP in January.

Kerviel has never denied taking risks -- at one point staking 50 billion euros ($69 billion) of the bank's money -- but maintains that his bosses were just as much at fault as he was.

Some commentators have interpreted his risk-taking as the desire of a young man from a working-class background to prove himself among the ranks of high-flying traders from elite schools.

In 2014, before going to prison, Kerviel spent two months walking from Rome to France to protest "the tyranny of the markets".

© 2016 AFP

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